The Nasdaq surged 2% last night, so why am I saying don't rush to chase it? Only 4 giants are rising.

First off: The Nasdaq (the major U.S. index weighted towards tech stocks) surged 2.07% last night, but this is not a broad tech rebound—the real gainers were the four mega-cap giants: Tesla, Amazon, Google, and Meta, while chip stocks (semiconductors) actually fell, and the Russell 2000, representing small and mid-cap companies, barely moved. Why it matters to you: If you see the Nasdaq surge and want to buy chip or tech ETFs, you might be betting in exactly the wrong direction—it was chips that fell yesterday.
Why is this happening? The Nasdaq is weighted by company size; a few giants rising lifts the index, masking the underlying chips' decline. Digging deeper: With inflation high and the Fed potentially raising rates (core PCE at 3.4%, a three-year high), chip stocks (like NVIDIA) that rely on future AI investment for profits are most vulnerable to high rates, so they're being sold off; while companies like Amazon, Google, and Meta that are already profitable now are more resilient. Plus, two good news items yesterday—the Supreme Court preserving the Fed's independence and a U.S.-Iran ceasefire—gave the market confidence to buy, and money flowed into these cash-rich giants.
So what to do? Four points: ① Don't chase chip/tech ETFs just because the Nasdaq is up—they were the ones falling yesterday; wait for chip leaders (like NVIDIA) to stabilize first. ② Within the AI chain, memory (Micron) bucked the trend and doubled its performance, worth watching, but it's already up 236% in a month—don't chase highs, wait for a pullback. ③ Cash-strong giants (Amazon/Google/Meta) are the beneficiaries this round; buy on dips, but Google's rise yesterday had a one-time factor of "being added to the Dow, prompting passive index fund buying," don't mistake it for a long-term trend. ④ For stability, defensive sectors like consumer staples and healthcare are better for a base position. Most crucial: This Thursday (ahead of schedule) the U.S. releases non-farm payroll data, which will determine rate hike expectations—don't go heavily directional before the data comes out.

$Micron Tech(MU.US) $VanEck Semiconductor ETF(SMH.US)